The Exchanges

Q You spent a fair amount of time at Nestle. Do you see that business model of a large FMCG company selling across the world? Do you think that's breaking? You see a lot of the multiples companies in FMCG are getting, coming down. They've been historically very expensive. Is the consumer moving to independent brands from large conglomerates?

A Not really. I think you see that movement began quite some time ago. It started for value at a point of time when it moved to these private labels in the case of some of the larger locations. But in the case of India, for example, Amul was a big breakthrough in milk, right? So you got brands that came up locally, but it's not as though the multinational brands aren't strong and High quality with high perceived advantages. The only difference is, In the emerging markets years back, if you were a global multinational brand, you had a halo of which you didn't feel you could get domestically. That certainly has changed. And Amul is an example of that high quality product, whether it's powder or yogurt or desserts or ghee or anything else today, Amul has a product that is as good as anybody else's. And I think that change Definitely leads to a lower dominance level for multinationals. But otherwise, the idea of a global company which has global standards, but locally executed with great delivery, it's still a very popular model. The issue of earning multiples and share pricing coming down, that's a whole other thing. I think there's a lot going on in the markets where people are putting money into new technologies, new industries, AI, finance, There's a lot of stuff going on, and rotating out is certain. What happens invariably in these markets is when there's, you know, friction, o…

AI assessment note: “Not really. I think you see that movement began quite some time ago.”

Q When I think about poverty and income inequality, it almost appears to me like the world does have enough. The distribution of what the world already has is not Equal, and hence there is poverty, and there is excess on the other side. Do you think that's right?

A Yeah, I don't think like that, because I think you're looking at an utopian system where somehow you could wave a magic wand and take from Peter to feed Paul, and I'd be a little careful about that thinking. That's not the way I believe. I believe that what creates wealth, first of all, is entrepreneurship and the private sector. I believe government's role is to create the infrastructure and the ability And the human capital and the rules and governance that enable the private sector to create jobs. I mean, 85 to 90% of jobs in the world are created in some form or the other in the private sector or in private sector-oriented enterprises in the state-owned sector.

AI assessment note: “I don't think like that, because I think you're looking at an utopian system”

Q like governments across the world can afford to raise interest rates beyond a certain point. And say the World Bank, for instance, is putting top down money into different economies, which are again, kind of saturating in the top and not really trickling down to the bottom in a fair manner. Why do we then make the case for income inequality really going down over the next decade or two?

A Six hundred million people in Africa don't have electricity today. And I don't mean, ah, inadequate electricity. None. Black. No electricity. What I'm talking about is not giving them one light, one fan with a solar cell on their roof. That to me is useful for quality of life. Basic. But not useful for productive use. We're talking about productive use of energy. And so we've committed to connect three hundred million people with the African Development Bank by 2030. As of June, we would be at 50 already. We got a line of sight to 200 or so. We'll find our way to, if not 302 50. That would be two and a half times what we connected in the last 10 years. That's not only at the top, that's going right to the people who want to set up a barber shop, or a chicken hatchery, or a farmer. You see what I mean? And so actually our money doesn't go to the top of the pyramid. Our money is being oriented towards this or healthcare. We're talking about getting 1.5 billion people access to better primary healthcare by 2030. Again, by this middle of this year, you would be at four hundred million. Now what does that mean by primary health care? A clinic near you, Where you can go where there's a nurse, a medical diagnostic technician, and a midwife. So you can actually, with technology, get access to a doctor who may be remote. He's not in the village, but he's there, shared by these villages.…

AI assessment note: “actually our money doesn't go to the top of the pyramid.”

Q Now, would you also see the demographic dividend that we all spoke about for so long, if a country has a big young population? It goes from being a boon to a bane, wherein if they don't have jobs, the same thing is a problem like we thought it was a privilege.

A Yeah, I think at the end of the day, you know, you used the words boon and bane, which is very smart. I use the words that this could be, instead of being a light at the end of the tunnel, it could be a freight train coming your way. And I think the purpose I say that is, the light at the end of the tunnel is the optimism and the opportunity, and by the way, everybody benefits. Right. Companies will benefit, their technology will be used, their products will be bought, their IP will be utilized, you know, everybody will have an opportunity. On the other hand, if you don't, then you create this insecurity matrix that we started discussing with. And I think that's a real issue. You have to worry about this. Unless, you know, there's those who say that if you could create a universal basic income, somehow you would solve for this. I don't think this is about income alone. I think this is about productive use of your mind and feeling that you're a part of society in a constructive way. It's not just about money. Of course it's about money. If you're starving, it's really about money. But it's beyond that. And it's about using your mind to do things as well. And I'm, I believe this to be a real issue, which we need to take on. How do you create jobs in an economy? And I told you about the pillars of infrastructure, both physical and human capital, and then the right rules and govern…

AI assessment note: “instead of being a light at the end of the tunnel, it could be a freight train”

Q all the names that we see in the Western world have elevated our status in society to a certain extent. I don't mean inside of India, but across the world. Like you, even in your own personal career, you went from one profession to another, to another, to another in completely diverse fields. What do you think is working? For the small subset of Indians who are doing well internationally.

A I see. I see. Well, I don't know. I think you've got to remember that we're a small subset, but we have self-selected because we were fortunate enough to get the right education and the right opportunities. I mean, if you look at a lot of the Indian CEOs who set examples around the world, a number of them studied overseas as well. I didn't. I'm one of the only ones I think you'd find who did all his education in India. I, I once cracked this joke with the prime minister. I said, my ultimate make in India. I was conceived in India, educated in India, and then I came out much after working there. And so, so you, I think that does change things. You know, it's a self-selected group, but Nikhil, growing up in India and working there, A couple of things you learn when you work there and grow up there, and it comes in use. And for me, I can tell you my own, but like growing up in the army housing system and education system, and where you lived and who you met, I took diversity for granted. You know, we would go to Eid celebrations, and Janamashtami, and Christmas, and Guru Nanak's birthday, without thinking that it was different.

AI assessment note: “we have self-selected because we were fortunate enough to get the right education”

Q And you speak a lot about climate change, Ajay. Do you think we are one adversity in a rich country away from taking climate more seriously?

A I think the issue is of two parts. Climate is a word that has become politicized. So if you step away from the politics of climate, and you start thinking about what's going on for people's lives, and that's where we are having this conversation come from. The concept of resiliency, of adaptation, should never be neglected in favor of the concept of mitigation. They're both important. And what do I mean by that? In the case of resiliency and adaptation, if you build a school That is hurricane resistant, or homes that are flood resistant, or roads that can resist monsoons, or seeds that are, you know, heat adaptive, or drip irrigation instead of the old fashioned form of flooding irrigation. Which of these don't make sense? They all make sense to do. I was in Pakistan. We're financing 2.5 million homes that were impacted by floods in Sindh. They've all been bent on a higher plinth with thicker walls. Common sense stuff.

AI assessment note: “So if you step away from the politics of climate, and you start thinking”